Exhibit 1.1
Alliant Techsystems
Inc.
UNDERWRITING
AGREEMENT
dated March 6, 2006
Banc of America Securities
LLC
Underwriting
Agreement
March 6, 2006
BANC OF AMERICA SECURITIES LLC
9 West 57 th Street
New York, NY 10019
Ladies and Gentlemen:
Introductory.
Alliant Techsystems Inc., a Delaware
corporation (the “Company”), proposes to issue and sell
to Banc of America Securities LLC (the “Underwriter”)
$400 million principal amount of its 6.750% Senior Subordinated
Notes due 2016 (the “Notes”). The Notes will be
guaranteed (collectively, the “Guarantees”) by each of
the subsidiary guarantors named in Schedule A hereto (the
“Notes Guarantors”). The Notes and the Guarantees are
collectively referred to herein as the
“Securities.” The Securities are to be issued
under an indenture between the Company and The Bank of New York
Trust Company, N.A., as trustee (the “Trustee”) and a
supplemental indenture, dated as of the Closing Date (as defined in
Section 4 hereof), among the Company, the Notes Guarantors and
Trustee (such indenture and supplemental indenture, collectively
the “Indenture”). The use of the neuter in this
Underwriting Agreement (the “Agreement”) shall include
the feminine and masculine wherever appropriate.
In addition, the Company has
commenced a cash tender offer (the “Tender Offer”) to
purchase any and all of its outstanding $400.0 million aggregate
principal amount of 8 ½% Senior Subordinated Notes due 2011
(the “8 ½% Notes”). The Company intends to finance
the Tender Offer with a portion of the proceeds from the sale of
the Securities as more fully described in the Prospectus (as
defined in Section 1 hereof). The closing of the offering of
the Securities as contemplated hereby is conditioned on the
Company’s acceptance for purchase of the 8 ½% Notes
validly tendered and not withdrawn on or prior to March 14,
2006.
1.
Representations and
Warranties . The Company and each Notes
Guarantor, jointly and severally, represent and warrant to, and
agree with, the Underwriter as of the date hereof that:
(a)
The Company has prepared and filed
with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3
(File No. 333- 132178), which contains a base prospectus (the
“Base Prospectus”), to be used in connection with the
public offering and sale of the Securities. Such registration
statement, as amended, including the financial statements, exhibits
and schedules thereto, at each time of effectiveness under the
Securities Act of 1933 and the rules and regulations
promulgated thereunder (collectively, the “Securities
Act”), including any required information deemed to be a
part thereof at the time of effectiveness pursuant to
Rule 430B under the Securities Act or the Securities Exchange
Act of 1934 and the rules and regulations
promulgated thereunder
(collectively, the “Exchange Act”), is called the
“Registration Statement.” Any preliminary
prospectus included in the Registration Statement is hereafter
called a “preliminary prospectus.” The term
“Prospectus” shall mean the final prospectus relating
to the Notes that is first filed pursuant to
Rule 424(b) after the date and time that this Agreement
is executed and delivered by the parties hereto (the
“Execution Time”). Any reference herein to the
Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of
Form S-3 under the Securities Act; any reference to any
amendment or supplement to any preliminary prospectus or the
Prospectus shall be deemed to refer to and include any documents
filed after the date of such preliminary prospectus or Prospectus,
as the case may be, under the Exchange Act, and incorporated
by reference in such preliminary prospectus or Prospectus, as the
case may be; and any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any
annual report of the Company filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated
by reference in the Registration Statement.
(b)
Compliance with Registration
Requirements . The
Registration Statement has become effective upon filing with the
Commission under the Securities Act. No stop order suspending the
effectiveness of the Registration Statement is in effect, the
Commission has not issued any order or notice preventing or
suspending the use of the Registration Statement, any preliminary
prospectus or the Prospectus and no proceedings for such purpose
have been instituted or are pending or, to the best knowledge of
the Company, are contemplated or threatened by the
Commission.
Each of the preliminary prospectus
and the Prospectus when filed complied in all material respects
with the Securities Act and the rules thereunder. Each of the
Registration Statement and any post-effective amendment thereto, at
each time of effectiveness and at the date hereof, complied and
will comply in all material respects with the Securities Act and
did not and will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein not
misleading. The Prospectus, as amended or supplemented, as of its
date, at the date hereof, at the time of any filing pursuant to
Rule 424(b) and, at the Closing Date (as defined herein),
did not and will not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. The representations and
warranties set forth in the two immediately preceding sentences do
not apply to statements in or omissions from the Registration
Statement or any post-effective amendment thereto, or the
Prospectus, or any amendments or supplements thereto, made in
reliance upon and in conformity with information relating to the
Underwriter furnished to the Company in writing by the Underwriter
expressly for use therein, it being understood and agreed that the
only such information furnished by the Underwriter consists of the
information described as such in Section 8(b) hereof.
There is no contract or other document required to be described in
the Prospectus or to be filed as an exhibit to the
Registration Statement that has not been described or filed as
required.
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The documents incorporated by
reference in the Prospectus, when they became effective or were
filed with the Commission, as the case may be, conformed in
all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable. Any further documents so filed and
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case
may be, will conform in all material respects to the
requirements of the Securities Act or the Exchange Act, as
applicable;
(c)
Well-Known Seasoned
Issuer. (i) At the
time of filing the Registration Statement, (ii) at the time of
the most recent amendment thereto for the purposes of complying
with Section 10(a)(3) of the Securities Act (whether such
amendment was by post-effective amendment, incorporated report
filed pursuant to Section 13 or 15(d) of the
Exchange Act or form of prospectus), (iii) at the time
the Company or any person acting on its behalf (within the meaning,
for this clause only, of Rule 163(c) of the Securities
Act) made any offer relating to the Securities in reliance on the
exemption of Rule 163 of the Securities Act,
and (iv) at the Execution Time (with such time being used
as the determination date for purposes of this clause (iv)), the
Company was and is a “well-known seasoned issuer” as
defined in Rule 405 of the Securities Act. The Registration
Statement is an “automatic shelf registration
statement”, as defined in Rule 405 of the Securities
Act, and the Company has not received from the Commission any
notice pursuant to Rule 401(g)(2) of the Securities Act
objecting to use of the automatic shelf registration statement
form.
(d)
Disclosure Package.
The term “Disclosure
Package” shall mean (i) the base prospectus, including
any preliminary prospectus supplement, if any, as amended or
supplemented, (ii) the issuer free writing prospectuses as
defined in Rule 433 of the Securities Act (each, an
“Issuer Free Writing Prospectus”), if any, identified
in Schedule B hereto, (iii) any other free writing
prospectus that the parties hereto shall hereafter expressly agree
in writing to treat as part of the Disclosure Package and
(iv) the Final Term Sheet (as defined herein), which also
shall be identified in Schedule B hereto. As of 3:19 pm
(Eastern time) on the date of this Agreement (the “Applicable
Time”), the Disclosure Package did not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The
preceding sentence does not apply to statements in or omissions
from the Disclosure Package based upon and in conformity with
written information furnished to the Company by the Underwriter
specifically for use therein, it being understood and agreed that
the only such information furnished by or on behalf of the
Underwriter consists of the information described as such in
Section 8(b) hereof.
(e)
Company Not Ineligible
Issuer. (i) At the
earliest time after the filing of the Registration Statement
relating to the Securities that the Company or another offering
participant made a bona fide offer (within the meaning of
Rule 164(h)(2)) of the Securities Act and (ii) as of the
date of the execution and delivery of this Agreement (with such
date being used as the determination date for purposes of this
clause (ii)), the Company was not and is not an Ineligible Issuer
(as defined in Rule 405 of the Securities Act), without taking
account of any determination by the Commission pursuant to
Rule 405 of
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the Securities Act that it is not
necessary that the Company be considered an Ineligible
Issuer.
(f)
Issuer Free Writing
Prospectuses. Each Issuer
Free Writing Prospectus, as of its issue date and at all subsequent
times through the completion of the offering of Notes under this
Agreement or until any earlier date that the Company notified or
notifies the Underwriter as described in the next sentence, did
not, does not and will not include any information that conflicted,
conflicts or will conflict with the information contained in the
Registration Statement. If at any time following issuance of an
Issuer Free Writing Prospectus there occurred or occurs an event or
development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information
contained in the Registration Statement, the Company has promptly
notified or will promptly notify the Underwriter and has promptly
amended or supplemented or will promptly amend or supplement, at
its own expense, such Issuer Free Writing Prospectus to eliminate
or correct such conflict. The foregoing two sentences do not apply
to statements in or omissions from any Issuer Free Writing
Prospectus based upon and in conformity with written information
furnished to the Company by the Underwriter through the Underwriter
specifically for use therein, it being understood and agreed that
the only such information furnished by the Underwriter consists of
the information described as such in
Section 8(b) hereof.
(g)
Distribution of Offering Material
by the Company. The
Company has not distributed and will not distribute, prior to the
later of the Closing Date (as defined below) and the completion of
the Underwriter’s distribution of the Securities, any
offering material in connection with the offering and sale of the
Securities other than the Preliminary Prospectus, the Prospectus,
any Issuer Free Writing Prospectus reviewed and consented to by the
Underwriter or included in Schedule B hereto or the
Registration Statement.
(h)
No Material Adverse
Change. Except as
otherwise disclosed in the Disclosure Package, subsequent to the
respective dates as of which information is given in the Disclosure
Package, (i) there has been no material adverse change, or any
development that could reasonably be expected to result in a
material adverse change, in the condition, financial or otherwise,
or in the earnings, business, properties, operations or prospects,
whether or not arising from transactions in the ordinary course of
business, of the Company and its subsidiaries, considered as one
entity (any such change is called a “Material Adverse
Change”); (ii) the Company and its subsidiaries,
considered as one entity, have not incurred any material liability
or obligation, indirect, direct or contingent, nor entered into any
material transaction or agreement other than in the ordinary course
of business; and (iii) there has been no dividend or
distribution of any kind declared, paid or made by the Company or,
except for dividends paid to the Company or other subsidiaries, any
of its subsidiaries on any class of capital stock or
repurchase or redemption by the Company or any of its subsidiaries
of any class of capital stock.
(i)
Incorporation and Good Standing
of the Company and its Subsidiaries. Each of the Company and its subsidiaries has
been duly incorporated and is validly existing as a corporation or
a limited liability company in good standing under the laws of
the
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jurisdiction of its incorporation
and has the requisite corporate or limited liability company power
and authority necessary, as applicable, to own or lease, as the
case may be, and operate its properties and to conduct its
business as described in the Disclosure Package and the Prospectus
and, in the case of the Company, to enter into and perform its
obligations under this Agreement. Each of the Company and each
subsidiary is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a
material adverse effect, on the condition, financial or otherwise,
or on the earnings, business, properties, operations or prospects,
whether or not arising from transactions in the ordinary course of
business, of the Company and its subsidiaries, considered as one
entity (a “Material Adverse Effect”). All of the issued
and outstanding shares of capital stock of each subsidiary have
been duly authorized and validly issued, are fully paid and
nonassessable and are owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or claim. The Company does not own or
control, directly or indirectly, any corporation, association or
other entity other than the subsidiaries listed in Exhibit 21
to the Registration Statement.
(j)
Capitalization and Other Capital
Stock Matters. The
authorized, issued and outstanding capital stock of the Company is
as set forth in the Disclosure Package and the Prospectus under the
caption “Capitalization” (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in
the Disclosure Package and the Prospectus or upon exercise of
outstanding options or warrants described in the Disclosure Package
and the Prospectus, as the case may be). The common stock
conforms in all material respects to the description thereof
contained in the Disclosure Package and the Prospectus. All of the
issued and outstanding shares of common stock have been duly
authorized and validly issued, are fully paid and nonassessable and
have been issued in compliance with federal and state securities
laws. None of the outstanding shares of common stock were issued in
violation of any preemptive rights, rights of first refusal or
other similar rights to subscribe for or purchase securities of the
Company.
(k)
The Securities.
The Notes to be purchased by the
Underwriter from the Company are in the form contemplated by
the Indenture, have been duly authorized for issuance and sale
pursuant to this Agreement and the Indenture and, at the Closing
Date, will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, will
constitute valid and binding agreements of the Company, enforceable
in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable principles
and will be entitled to the benefits of the Indenture. The
Guarantees of the Notes are in the respective forms contemplated by
the Indenture, have been duly authorized for issuance and sale
pursuant to this Agreement and the Indenture and, at the Closing
Date, will have been duly executed by each of the Notes Guarantors
and, when the Notes have been authenticated in the manner provided
for in the Indenture and delivered against payment of the purchase
price therefor, will constitute valid and binding agreements of the
Notes Guarantors,
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enforceable in accordance with their
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors
or by general equitable principles and will be entitled to the
benefits of the Indenture.
(l)
The Indenture.
The Indenture has been duly
authorized by the Company and, at the Closing Date, will have been
duly executed and delivered by the Company and will constitute a
valid and binding agreement of the Company, enforceable in
accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable
principles;
(m)
Description of
Documents. The Securities
and the Indenture will conform in all material respects to the
descriptions thereof in the Disclosure Package and the
Prospectus;
(n)
None of the transactions
contemplated by this Agreement (including, without limitation, the
use of the proceeds from the sale of the Securities) will violate
or result in a violation of Section 7 of the Exchange Act, or
any regulation promulgated thereunder, including, without
limitation, Regulations T, U, and X of the Board of Governors of
the Federal Reserve System;
(o)
Non-Contravention of Existing
Instruments. Neither the
Company nor any of its subsidiaries is (i) in violation or in
default (or, with the giving of notice or lapse of time, would be
in default) under (“Default”) its charter or by-laws,
(ii) in Default under any indenture, mortgage, loan or credit
agreement, deed of trust, note, contract, franchise, lease or other
agreement, obligation, condition, covenant or instrument to which
the Company or such subsidiary is a party or by which it
may be bound (including, without limitation, the
Company’s 8 ½ % Senior Subordinated Notes due 2011 or
the related indenture, the Company’s 2.75% Convertible Senior
Subordinated Securities due 2024 or the related indenture, the
Company’s 3.00% Convertible Senior Subordinated Securities
due 2024 or the related indenture and the Credit Agreement, dated
as of March 31, 2004, among the Company, as borrower, Bank of
America, N.A. (“BOA”), as Administrative Agent, the
lenders party thereto, Credit Lyonnais New York Branch, as
Syndication Agent, The Bank of New York, U.S. Bank National
Association (“US Bank”), and National City Bank, as
Co-Documentation Agents, Banc of America Securities LLC and Credit
Lyonnais New York Branch, as Joint Lead Arrangers, and Banc of
America Securities LLC, as Sole Bookrunning Manager, as amended by
that certain Amendment No. 1 to Credit Agreement, dated as of
May 5, 2005 among the Company, the lenders party thereto, BOA
as swing line lender, Bank of America, Calyon New York Branch
(f/k/a Credit Lyonnais New York Branch), US Bank National
Association and JPMorgan Chase Bank, N.A., as L/C Issuers, and BOA
as administrative agent (collectively, the “Senior Credit
Facility”), or to which any of the property or assets of the
Company or any of its subsidiaries is subject (each, an
“Existing Instrument”), or (iii) in violation of
any statute, law, rule, regulation, judgment, order or decree of
any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the
Company or such subsidiary or any of its properties, as applicable,
except with respect to
6
clauses (ii) and (iii), for
such Defaults or violations as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect. The Company’s execution, delivery and performance of
this Agreement and consummation of the transactions contemplated
hereby, by the Disclosure Package and by the Prospectus
(i) have been duly authorized by all necessary corporate
action and will not result in any Default under the charter or
by-laws of the Company or any subsidiary, (ii) will not
conflict with or constitute a breach of, or Default or a Debt
Repayment Triggering Event (as defined below) under, or result in
the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries
pursuant to, or require the consent of any other party to, any
Existing Instrument, and (iii) will not result in any
violation of any statute, law, rule, regulation, judgment, order or
decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company
or any of its subsidiaries or any of its or their properties,
except with respect to clauses (ii) and (iii), for such
breach, Default, Debt Repayment Triggering Event, or violations as
would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(p)
No Further Authorizations or
Approvals Required. No
consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory
authority or agency is required for the Company’s execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by
the Prospectus, except such as have been obtained or made by the
Company and are in full force and effect under the Securities Act,
applicable state securities or blue sky laws and from the NASD Inc.
(the “NASD”). As used herein, a “Debt Repayment
Triggering Event” means any event or condition which gives,
or with the giving of notice or lapse of time would give, the
holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder’s behalf) the right to
require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Company or any of its
subsidiaries.
(q)
No Material Actions or
Proceedings. Except as
otherwise disclosed in the Disclosure Package and the Prospectus,
there are no legal or governmental actions, suits or proceedings
pending or, to the best of the Company’s knowledge,
threatened (i) against or affecting the Company or any of its
subsidiaries, or (ii) which have as the subject thereof any
officer or director of, or property owned or leased by, the Company
or any of its subsidiaries, where in any such case (A) such
action, suit or proceeding would reasonably be expected to be
determined adversely to the Company or such subsidiary, or any
officer or director of, or property owned or leased by, the Company
or any of its subsidiaries and (B) any such action, suit or
proceeding, if so determined adversely, would reasonably be
expected to have a Material Adverse Effect.
(r)
Exchange Act
Compliance. The Company
is subject to and in compliance in all material respects with the
reporting requirements of Section 13 or 15(d) of the
Exchange Act;
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(s)
Independent
Accountants. Deloitte & Touche LLP, who have
expressed their opinion with respect to the financial statements
(which term as used in this Agreement includes the related notes
thereto) and supporting schedules filed with the Commission as a
part of the Registration Statement and included in the
Disclosure Package and the Prospectus, are independent public
accountants with respect to the Company as required by the
Securities Act and the Exchange Act and the applicable published
rules and regulations thereunder.
(t)
Preparation of Financial
Statements. The financial
statements filed with the Commission as a part of or
incorporated by reference in the Registration Statement and
included or incorporated by reference in the Disclosure Package and
the Prospectus present fairly the consolidated financial position
of the Company and its subsidiaries as of and at the dates
indicated and the results of their operations and cash flows for
the periods specified. The supporting schedules included or
incorporated by reference in the Registration Statement present
fairly the information required to be stated therein. Such
financial statements and supporting schedules comply as to
form in all material respects with the applicable accounting
requirements of the Securities Act and have been prepared in
conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved, except as
may be expressly stated in the related notes thereto. No other
financial statements or supporting schedules are required to be
included or incorporated by reference in the Registration
Statement. The financial data set forth in the preliminary
prospectus and the Prospectus under the captions “Prospectus
Supplement Summary—Summary Selected Financial and Operating
Data”, “Selected Consolidated Historical Financial
Data” and “Capitalization” fairly present the
information set forth therein on a basis consistent with that of
the audited financial statements contained in the Registration
Statement.
The Company’s ratios of
earnings to fixed charges set forth in the Preliminary Prospectus
Supplement under the captions “Preliminary Prospectus
Summary—Summary Selected Financial and Operating Data”
and “Selected Consolidated Historical Financial Data”
and in Exhibit 12 to the Registration Statement have been
calculated in compliance in all material respects with the
requirements of Item 503(d) of Regulation S-K under the
Securities Act.
(u)
This Agreement has been duly
authorized, executed and delivered by the Company and each Notes
Guarantor.
(v)
Intellectual Property
Rights. The Company and
its subsidiaries own or possess adequate rights to use all material
patents, patent applications, trade and service marks, trade and
service mark registrations, copyrights, licenses and know-how
(including trade secrets another unpatented and unpatentable
proprietary or confidential information, systems or procedures)
(collectively, the “Intellectual Property”) necessary
for the conduct of their respective businesses; and the conduct of
their respective businesses will not conflict in any material
respect with, and the Company and its subsidiaries have not
received any notice of any claim of conflict with, any such rights
of others which reasonably be expected to result in a Material
Adverse Change.
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(w)
All Necessary Permits,
etc. The Company and each
subsidiary possess such material, valid and current licenses,
certificates, authorizations or permits issued by the appropriate
state, federal or foreign regulatory agencies or bodies necessary
to conduct their respective businesses, and neither the Company nor
any subsidiary has received any notice of proceedings relating to
the revocation or modification of, or non-compliance with, any such
license, certificate, authorization or permit which, singly or in
the aggregate, could have a Material Adverse Effect.
(x)
Title to Properties.
The Company and each of its
subsidiaries has good and marketable title to all the properties
and assets reflected as owned in the financial statements referred
to in Section 1(t) above (or elsewhere in the Disclosure
Package and the Prospectus), in each case, free and clear of any
security interests, mortgages, liens, encumbrances, equities,
claims and other defects, except such as (i) arise under the
Senior Credit Facility, (ii) do not materially and adversely
affect the value of such property and do not materially interfere
with the use made or proposed to be made of such property by the
Company or such subsidiary or (iii) could not reasonably be
expected to have a Material Adverse Effect. The real property,
improvements, equipment and personal property held under lease by
the Company or any subsidiary are held under valid and enforceable
leases, with such exceptions as (i) are not material and do
not materially interfere with the use made or proposed to be made
of such real property, improvements, equipment or personal property
by the Company or such subsidiary or (ii) could not reasonably
be expected to have a Material Adverse Effect.
(y)
Tax Law Compliance.
The Company and its consolidated
subsidiaries have filed all necessary federal, state, local and
foreign income and franchise tax returns in a timely manner and
have paid all taxes required to be paid by any of them and, if due
and payable, any related or similar assessment, fine or penalty
levied against any of them, except for any taxes, assessments,
fines or penalties as may be being contested in good faith and
by appropriate proceedings or could not reasonably be expected to
result have a Material Adverse Effect. The Company has made
appropriate provisions in accordance with generally accepted
accounting principles in the applicable financial statements
referred to in Section 1(t) above in respect of all federal,
state, local and foreign income and franchise taxes for all current
or prior periods as to which the tax liability of the Company or
any of its consolidated subsidiaries has not been finally
determined.
(z)
Company Not an “Investment
Company”. The
Company has been advised of the rules and requirements under
the Investment Company Act of 1940, as amended (the
“Investment Company Act”). The Company is not, and
after receipt of payment for the Securities and the application of
the proceeds thereof as contemplated under the caption “Use
of Proceeds” in each of the preliminary prospectus and the
Prospectus will not be, an “investment company” within
the meaning of the Investment Company Act.
(aa)
Insurance.
Each of the Company and its
subsidiaries are insured by recognized, financially sound and
reputable institutions with policies in such amounts and with such
deductibles and covering such risks as are generally deemed
adequate and customary for their businesses. All policies of
insurance insuring the Company or any of its
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subsidiaries or their respective
businesses, assets, employees, officers and directors are in full
force and effect. The Company has no reason to believe that it or
any subsidiary will not be able (i) to renew its existing
insurance coverage as and when such policies expire or (ii) to
obtain comparable coverage from similar institutions as may be
necessary or appropriate to conduct its business as now conducted
and at a cost that would not have a Material Adverse
Effect.
(bb)
No Restrictions on
Dividends. Except as
may be imposed by applicable law, no subsidiary of the Company
is currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on
such subsidiary’s capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary’s property or assets to
the Company or any other subsidiary of the Company, except as
described in or contemplated by the Disclosure Package and the
Prospectus.
(cc)
No Price Stabilization or
Manipulation. The Company
has not taken and will not take, directly or indirectly, any action
designed to or that might be reasonably expected to cause or result
in stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the
Securities.
(dd)
Related Party
Transactions. There are
no business relationships or related-party transactions involving
the Company or any subsidiary or any other person required to be
described in the preliminary prospectus or the Prospectus that have
not been described as required.
(ee)
Internal Controls and
Procedures. The Company
maintains (i) effective internal control over financial
reporting as defined in Rule 15d-15 under the Exchange Act,
and (ii) a system of internal accounting controls sufficient
to provide reasonable assurance that (A) transactions are
executed in accordance with management’s general or specific
authorizations; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset
accountability; (C) access to assets is permitted only in
accordance with management’s general or specific
authorization; and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any
differences.
(ff)
No Material Weakness in Internal
Controls. Except as
disclosed in the Disclosure Package and the Prospectus, or in any
document incorporated by reference therein, since the end of the
Company’s most recent audited fiscal year, there has been
(i) no material weakness in the Company’s internal
control over financial reporting as defined in Rule 15d-15
under the Exchange Act (whether or not remediated) and (ii) no
change in the Company’s internal control over financial
reporting that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over
financial reporting.
(gg)
No Unlawful Contributions or
Other Payments. Neither
the Company nor any of its subsidiaries nor, to the knowledge of
the Company, any director, officer, agent,
10
employee or affiliate of the Company
or any of its subsidiaries is aware of or has taken any action,
directly or indirectly, that would result in a violation by such
Persons of the FCPA, including, without limitation, making use of
the mails or any means or instrumentality of interstate commerce
corruptly in furtherance of an offer, payment, promise to pay or
authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of
value to any “foreign official” (as such term is
defined in the FCPA) or any foreign political party or official
thereof or any candidate for foreign political office, in
contravention of the FCPA.
“FCPA” means Foreign
Corrupt Practices Act of 1977, as amended, and the rules and
regulations thereunder.
(hh)
No Conflict with OFAC
Laws. Neither the Company
nor any of its subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company
or any of its subsidiaries is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of
the U.S. Treasury Department (“OFAC”); and the Company
will not directly or indirectly use the proceeds of the offering,
or lend, contribute or otherwise make available such proceeds, to
any subsidiary, joint venture partner or other person or entity,
for the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.
(ii)
Compliance with Environmental
Laws. Except as
otherwise disclosed in the Disclosure Package and the Prospectus or
as could not reasonably be expected to have a Material Adverse
Effect, (i) neither the Company nor any of its subsidiaries is
in violation of any federal, state, local or foreign law,
regulation, order, permit or other requirement relating to
pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife,
including without limitation, laws and regulations relating to
emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”),
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
Materials of Environment Concern (collectively,
“Environmental Laws”), which violation includes, but is
not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the
business of the Company or its subsidiaries under applicable
Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received
any written communication, whether from a governmental authority,
citizens group, employee or otherwise, that alleges that the
Company or any of its subsidiaries is in violation of any
Environmental Law, except as would not, individually or in the
aggregate, have a Material Adverse Effect; (ii) there is no
claim, action or cause of action filed with a court or governmental
authority, no investigation with respect to which the Company has
received written notice, and no written notice by any person or
entity alleging potential liability for investigatory costs,
cleanup costs, governmental responses costs, natural resources
damages, property damages, personal injuries, attorneys’ fees
or penalties arising out of, based on or resulting from the
presence, or release into the environment, of any Material of
Environmental Concern at any location owned, leased or operated by
the Company or
11
any of its subsidiaries, now or in
the past (collectively, “Environmental Claims”),
pending or, to the best of the Company’s knowledge,
threatened against the Company or any of its subsidiaries or any
person or entity whose liability for any Environmental Claim the
Company or any of its subsidiaries has retained or assumed either
contractually or by operation of law, except as would not,
individually or in the aggregate, have a Material Adverse Effect;
(iii) to the best of the Company’s knowledge, there are
no past, present or anticipated future actions, activities,
circumstances, conditions, events or incidents, including, without
limitation, the release, emission, discharge, presence or disposal
of any Material of Environmental Concern, that reasonably could
result in a violation of any Environmental Law, require
expenditures to be incurred pursuant to Environmental Law, or
form the basis of a potential Environmental Claim against the
Company or any of its subsidiaries or against any person or entity
whose liability for any Environmental Claim the Company or any of
its subsidiaries has retained or assumed either contractually or by
operation of law, except as would not, individually or in the
aggregate, have a Material Adverse Effect; and (iv) neither
the Company nor any of its subsid